The battle for more well heeled coach passengers is heating up in the US, with the popular Megabus brand fending off accusations from rivals that its vehicles breach weight limits.
Politicians in New York are challenging Stagecoach, Megabus’s owner, over the weight of its double-decker coaches, spurred on by a study commissioned by a smaller intercity coach operator.
Megabus’s business model depends on loading up its 81-seat coaches using the sort of dynamic pricing and strong yield management employed by budget airlines. But the study, paid for by Adirondack Transit Lines, suggested that when a Megabus double-decker was full, it exceeded the weight limit for two-axle vehicles on New York roads by about 4,000lbs.
A group of Manhattan politicians, including the borough president, sent a letter to the New York State Department of Transportation this month asking authorities to ensure Megabus is not breaking the law.
UK-listed Stagecoach dismissed the concerns: “Our vehicles are inspected and certified by the [US] Department of Transportation. They are also fully compliant with Federal regulations for motorcoaches,” it said, citing US law limiting commercial vehicles to 80,000lbs.
The battle casts a shadow of regulatory and political risk over the UK transport group’s fastest-growing division. Megabus increased sales by nearly 70 per cent last year as cash-strapped Americans took advantage of fares as low as $1 for journeys between cities in the Midwest, north-east corridor, south-east and Canada.
Megabus’s entry into the market in 2006, and rapid expansion since, has pushed rivals to raise their game. Greyhound, the US’s legacy coach company, launched Greyhound Express in December 2010, a point-to-point service which, like Megabus, offers passengers faster journeys by limiting stops.
Both brands cater to a more middle-class market by providing free wifi on the vehicles and electrical sockets at most seats. Greyhound Express is owned by another UK company, FirstGroup, which also has a stake in a Megabus competitor, Bolt.
While heavy vehicles increase road repair and maintenance costs, the politicians are also concerned with constituents’ complaints related to curbside pick-up and drop-off locations – a feature that helps reduce Megabus’s costs and appeals to some customers eager to avoid the labyrinthine Port Authority Bus Terminal.
Richard Gottfried, a member of the New York State Assembly and signatory of the letter, said: “The issue for the neighbourhood and me is the impact on air quality and traffic.”
Greyhound, Peter Pan Bus Lines – its partner in Bolt – and Andirondack Transit are meanwhile suing New York City’s Department of Transportation for allowing Megabus free access to city blocks, arguing it stymies competition.
Stagecoach said on Friday that Megabus’s growth was underpinned by people moving to coach from car, train and plane rather than other coach operators. “Megabus.com has been a huge success and is incredibly popular with passengers. It has helped spark a resurgence in intercity coach travel as people switch from the car to a greener and better value form of transport.”
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